James Gurulé discusses how organizations are addressing their burning platform with a cross-functional approach.

Let’s begin with a pop quiz...how many leading businesses can you think of that are as dominant today as they were 20 years ago? Of course, there are some, but these are challenging times for even the biggest and best-managed organizations. Rapid economic and technological changes mean an approach that worked pretty well for you yesterday might not be working quite so well today and could be catastrophic by tomorrow.

Earlier this year, we gave you a brief overview of four key themes that we believe will have a significant impact on the PE market in 2017. This month, we’re diving a little deeper into the first of those themes; how and why PE executives, particularly those operating in the middle market, are turning their attention to operational improvements in order to achieve accelerated value creation.

There are some procurement ‘facts’ that we hear over and over again in our meetings with company executives. Do any of the following sound familiar?

“We’re a big company, that means we get the best prices.”

“We did a sourcing study just last year and got 1% savings. There’s nothing more there to be had.”

“What we buy is very unique, there are no other credible suppliers.”

The very fact that everybody’s saying the same thing means it must be true, right? Wrong. The truth is that none of these is accurate, not one. In our experience, there are almost always additional savings to be made; you just need to know how to look deep into your value chain to unlock them.